ED books Subhash Chandra in money laundering case over LIC Housing Finance loans

• The ED has registered a money laundering case against Subhash Chandra over suspected loan fraud involving LIC Housing Finance.

• The lender’s complaint concerns two loans totalling Rs 980 crore, defaults on which it says caused a Rs 1,322 crore loss.

• Investigators are examining accusations that inflated net-worth certificates were used to secure the loans; Chandra’s response is awaited.

The Enforcement Directorate has registered a money laundering case against media baron and former Rajya Sabha MP Subhash Chandra in connection with suspected loan fraud that LIC Housing Finance Limited says caused it a loss of Rs 1,322 crore, officials said on Monday.

The agency initiated proceedings under the Prevention of Money Laundering Act on the basis of a CBI FIR registered following a complaint from the housing finance company.

The complaint accuses Chandra of furnishing inflated net-worth certificates to help secure two loans worth a combined Rs 980 crore, which subsequently went into default. A response from Chandra was awaited.

One facility, worth Rs 500 crore, was extended to Vasant Sagar Properties Private Limited, with Pan India Infra Projects Private Limited as co-borrower. The second, worth Rs 480 crore, was granted to Digital Subscriber Management and Consultancy Services Private Limited, with Spirit Infra Power and Multi Ventures Private Limited as co-borrower.

According to the complaint, the Vasant Sagar loan was approved for takeover, top-up and business expansion purposes. It was backed by a continuing guarantee executed by Chandra on 28 March 2018.

The second loan was a rental-discounting facility under a rental-securitisation scheme and was also supported by his continuing guarantee, according to the FIR.

The lender’s complaint centres on certificates submitted as evidence of Chandra’s financial standing when the facilities were approved.

LIC Housing Finance said a certificate issued by DJM and Co on 28 March 2018, placed his net worth at approximately Rs 59,000 crore. Another certificate, issued by chartered accountants MPJ and Co on 6 July 2018, valued it at Rs 40,562 crore and formed part of the basis for sanctioning the Rs 480 crore facility.

The complaint states that Chandra subsequently disputed the net-worth figures during proceedings under the Insolvency and Bankruptcy Code, 2016. According to the FIR, he put his net worth in 2024 at Rs 31.79 crore and stated that it had not exceeded Rs 40,000 crore in 2017–18.

The CBI FIR accuses Chandra of acting with the borrowing companies and their officers and directors to obtain funds through false documentation. It also accuses the borrower entities of misappropriating the loans. These accusations remain subject to investigation.

LIC Housing Finance’s August complaint put the loss arising from the defaults at Rs 1,322 crore.

The lender was also among creditors that approached the National Company Law Appellate Tribunal against a repayment plan approved by the National Company Law Tribunal. That plan would allow creditors to recover approximately Rs 6.5 crore from Chandra’s personal estate against claims totalling roughly Rs 22,006 crore.

With PTI inputs